Energy companies are increasingly relying on loopholes in disclosure laws to skirt transparency rules.
These loopholes are known as ‘disclosures breaches’, and they are one of the most frequently cited reasons for companies using them.1.
What is a disclosure breach?
A disclosure breach is when an information provider or service provider uses a loophole to hide information.
This loophole can be used to avoid disclosing the details of a transaction.
For example, an energy company could use a loophole like this to hide the identity of a person in the billing records of a customer.2.
How do disclosure breaches work?
The disclosure breach loophole has been around since 2009, and has become more prevalent in recent years.
A disclosure breach involves a company concealing a transaction’s identity from the end user.
For a disclosure to occur, the disclosure provider or the information provider must be in a position to know that the transaction is real.
In some cases, the end-user may not know that there is a transaction involved.
Disclosure breaches are also often used to conceal the identities of consumers.
In some cases where a disclosure is allowed, it can be a form of ‘blacklisting’ where the disclosure providers only allow the end users to view certain information.
The end user is then unlikely to know about the transaction.3.
How common is disclosure breach for energy companies?
Disclosure breaches are common among energy companies.
Data breaches of at least $10 million are commonplace.4.
How does the energy industry react to disclosures?
In the US, the Energy Information Administration (EIA) has established guidelines for disclosing the identity and addresses of consumers who purchase energy services from energy companies in the US.
The EIA also offers a list of disclosures that can be obtained for energy consumers, which is used by consumers in their applications for loans and credit, or for mortgage or other debt refinancing.
Energy companies are not required to disclose any information about the consumers that they are disclosing, but they must provide their identity and address to EIA, if asked.5.
What happens if an energy provider doesn’t comply with disclosure requirements?
If an energy service provider doesn, for any reason, choose not to provide the information that the consumer needs, the consumer can file a complaint with the Department of Energy and Climate Change (DECC).
A DECC complaint is a formal legal process that can lead to a court action.
Energy providers are often reluctant to disclose their customer data.
However, there are several ways for consumers to take their complaint to the DECC.
For consumers who want to complain about energy companies, Energy Consumers Alliance (ECAI) is a non-profit organisation that provides legal and other support services.ECAI provides legal representation and is a legal aid provider for energy service providers, including energy suppliers.ECCA’s Energy Consumers Advocacy Network (ECAN) is an advocacy organisation that supports consumers who are impacted by energy industry disclosure practices.ECAN’s website contains a list, in English and in Spanish, of legal options that can help consumers if they believe they have been harmed by energy companies who have failed to disclose the identity or addresses of their customers.ECANN’s website also contains information on how to contact the DEC.
For more information on the Energy Consumers Act, see Energy Consumers Action Fund (ECAPF).
For consumers interested in reporting a company for disclosure breaches, they can contact the Department for Energy and Energy Efficiency (DECE) by emailing DECE at [email protected] or by phone on 0800 020 5030.
Energy consumers have the right to complain to the DEEC, and they can also take action by submitting a complaint to DECE online.
For more information about energy disclosure breaches or consumer protection, please visit energy.gov.au.